Staying Out of Debt

Change your attitude towards debt. Make a commitment to live on present income only. No more living today and paying for it later.

Don't use long-term debt for short-term pleasures like a vacation or gifts or entertainment. Save for these expenses before you buy them.

Have no more than two or three credit cards.

Never charge more than you'll be able to pay off entirely when the bill comes in.

Move any outstanding credit card balances to a card charging a lower interest rate and/or lower fees. Find a lower interest rate if you intend to carry over a balance from month to month. If you pay off the bill before it is due, look for a card with no or the lowest annual fee.

Cancel in writing any unused credit lines once the balance is zero.

After you pay down debts, begin to build savings as a second way to increase financial security.